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TICKERS: DRRX

Commercial Launch Planned for Schizophrenia Drug

Source:

A drug used to treat schizophrenic patients will launch commercially in February in the U.S.

DURECT Corp. (DRRX:NASDAQ), a biopharmaceutical company, noted that Indivior Plc (INDV:LON) announced that it will launch in the U.S. its drug for the treatment of schizophrenia, PERSERIS™, in February. PERSERIS is a drug used to treat adult patients dealing with schizophrenia. It contains risperidone in an extended-release injectable suspension.

In late September 2017, DURECT entered a patent purchase agreement whereby it assigned to Indivior UK Limited, an affiliate of Indivior PLC, certain patents that may provide further intellectual property protection for its drug PERSERIS.

Indivior paid $12.5 million to DURECT upfront. After the FDA approved PERSERIS in July 2018, Indivior paid DURECT an additional $5 million in August 2018.

DURECT is also entitled to quarterly earn-out payments that are based on a single-digit percentage of U.S. net sales for certain products covered by the assigned patent rights (including PERSERIS). The patent rights include granted patents extending through at least 2026.

PERSERIS has been available in the United States since mid-November 2018, but Indivior announced on December 18, 2018 that, in February 2019, the company is "moving ahead with the launch of PERSERIS in the U.S. with a sales force consisting of approximately 50 representatives."

In the meantime, "the PERSERIS team is currently engaged in creating payer access, growing prescriber awareness and interest, as well as establishing its INSUPPORT™ patient hub."

DURECT President and CEO James E. Brown added, "We are pleased to see that Indivior is engaged in pre-launch activities, and we look forward to the commercialization of PERSERIS and the associated quarterly earn-out payments that we will receive in the coming years."

"It's called an earn-out as opposed to a royalty because DURECT assigned Indivior the patents, so Indivior is now the owner of those patents. The term "royalty" is used when someone is paying a fee to use someone else's property. In this case, we use the term "earn-out" because we no longer own the patents and the earn-out fees we receive are part of the price Indivior agreed to pay to purchase those patents." explained Michael H. Arenberg, DURECT's CFO.

Indivior has stated that it is confident in its peak net revenue guidance for PERSERIS of $200–300 million per year.

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Disclosure:
1) Nikia Wade compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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